Khazanah Nasional In Talks to Buy Acibadem

Malaysian government fund Khazanah Nasional is in talks to buy a stake in Turkish hospital group Acibadem, Reuters reported Friday. The deal could be valued at around $500, Reuters said. Acibadem is owned by Almond Holding, a joint venture between Dubai-based private equity group Abraaj Capital and the Turkish family Aydinlar.

(Reuters) – Malaysian state fund Khazanah Nasional is in talks to buy a stake in Turkish hospital group Acibadem , two sources with direct knowledge of the deal told Reuters, in a deal that could be worth at least $500 million.

Integrated Healthcare, Khazanah’s 70 percent-owned healthcare unit, is in talks with Acibadem’s biggest shareholder, Almond Holding, which owns a 92 percent stake in the hospital group.

“The sellers have multiple buyers at this point, and Integrated Healthcare is one of the interested parties,” one of the sources told Reuters. The sources can’t be named as Khazanah’s interest has not been made public.

Reuters reported earlier this week that the Acibadem stake had attracted interest from several private equity firms including Blackstone , KKR , TPG Capital and Advent International.

The source told Reuters that the equity structure of the deal has not been fixed. Almond Holding is owned by two shareholders: Dubai-based private equity group Abraaj Capital, which holds 46 percent, and the rest by Turkish family Aydinlar.

While Abraaj has expressed an interest to sell its stake in Acibadem, the Aydinlar party has not decided if it will also sell outright or if it will undertake a new joint venture with the new shareholder.

A Khazanah spokesman declined to comment for the story, while Aabraj could not be immediately reached as Friday is a holiday in Dubai.

One of the sources said that Integrated Healthcare is seeking advice from Deutsche Bank for the purchase of the stake in Acibadem. Deutsche also advised Khazanah on its purchase of Singapore’s Parkway last year.

Deutsche declined to comment for this story.

The stake sale is being conducted by Goldman Sachs and Merrill Lynch and should be completed before the end of the year, the source added.

“It’s expected to only get done in early December. There’s no due diligence yet with just information having been exchanged,” he said.

KHAZANAH’S HEALTHCARE FOCUS

Khazanah, which has numerous interests including banking and aviation, has identified healthcare as one of its key businesses amidst a government call for the fund to pare down its stake in corporates to improve market liquidity.

Khazanah purchased Asia’s biggest listed hospital operator Parkway last year in a deal that valued the company at $3.3 billion, outbidding Indian competitor Fortis Healthcare International.

Fortis also recently withdrew from negotiations with Almond Holding on the Acibadem purchase, citing concerns over valuation and the present political uncertainty.

Parkway is held under Khazanah’s Integrated Healthcare, which is in turn 30 percent owned by Japanese trading house Mitsui & Co .

Azman Mokhtar, the managing director of Khazanah, has said that the fund will seek to list Integrated Healthcare within the next three years although other media reports have cited a shorter time frame.

(Additional reporting by Dinesh Nair in Dubai; Editing by Muralikumar Anantharaman)